Hot Water Distribution Services Under SAC Code 996922
Hot water distribution services cover supply of steam, hot water and central air conditioning to buildings and industrial users through shared utility networks. Providers operate boilers, chillers, pipelines and control systems so that clients receive steady temperature controlled supply. Under GST, these steam, hot water and air conditioning supply services are classified under SAC 996922. This SAC code and its GST treatment decide how GST is charged on such utility bills.
Hot Water Distribution Services GST Rate for SAC Code 996922
Electricity, gas, water and similar utility distribution services under these codes are treated as utility supply and distribution services under GST. In many cases, supply or transmission by recognised utilities enjoys specific exemptions, while commercial or non utility distribution may be taxable.
After the September 2025 rationalisation, wherever these utility services are taxable, the service component is generally placed in the 18 % slab with input tax credit, because network operation and distribution are input intensive. Where services continue to enjoy a notified exemption or zero effective rate, that treatment remains available as per the latest GST notifications.
The table below gives the broad GST treatment for SAC code 996922, showing the standard 18 % slab where taxable and any exempt utility cases as per notification.
| Code | Description | Old GST Rate (till 21 Sep 2025) |
New GST Rate (from 22 Sep 2025) |
Notes on change / inclusions |
|---|---|---|---|---|
| 996922 | Services involving distribution of steam, hot water and air conditioning supply etc. | 18% with ITC | 18% with ITC | Distribution of steam, hot water and air-conditioning is treated like other utility-type services under heading 9969 and taxed at the standard 18% with ITC. No specific entry in the 56th Council documents changes this, so the rate remains 18%. |
Utility providers and industrial park operators should carefully check whether their supply falls under an exempt utility category or a taxable commercial service. Invoices should clearly mention the SAC code, applicable GST rate in % and tax amount so that customers can account for input tax credit correctly where eligible and keep the same treatment in GSTR 1 and GSTR 3B.
Explore Other SAC Codes Under 9969
These SAC codes are part of the utility distribution group 9969, which covers transmission and distribution of electricity, gas, water, steam and similar utilities. Each six digit SAC in this group captures a specific utility type or distribution model for GST classification.
Utility providers, industrial park operators and large consumers should identify whether their contracts relate to exempt utility supply by recognised utilities or taxable commercial distribution services. Using the correct SAC and GST rate in %, and disclosing exemptions properly, helps avoid classification disputes and keeps the input tax credit trail clean for all parties.
Conclusion
Hot water and steam distribution services under SAC 996922 cover shared supply of steam, hot water and central cooling to buildings and industries. These are generally treated as taxable utility services, often at 18 % with input tax credit, because they are commercial and input intensive. Providers should apply the correct GST rate on bills, mention SAC 996922 and keep matching treatment in GST returns so that customers can manage input tax credit smoothly.
Important Disclaimer
The entire content on this page has been arranged to the best of the author's understanding and is subject to periodic updates as per the law for the time being in force. The above does not constitute professional advice or a formal recommendation. While due care has been taken in preparing this content, the existence of mistakes and omissions cannot be ruled out. BUSY Infotech Private Ltd. and its associates will not be held responsible for any loss or damage arising from any inaccurate or incomplete information in this document. We recommend consulting a professional tax consultant before acting on the information contained in this piece of content.